Ankity111/rag · Datasets at Hugging Face

text stringlengths 4 187
Sanjeev Sharma: So, Ankur, nothing increases in a straight line. And if you go back many quarters, the motors
division has been growing at a very, very healthy rate. So, I think we have not only gamed the
market, but also, we have gained a lot of market share. Now a time comes when you will always
have a certain adjustment of the market demand and also adjustment of the competition, response
also to the position you take in the marketplace. So, in a portfolio wherein we have 18 divisions,
and we have 23 market segments, we will always see this cyclicality, which is built into our kind
of portfolio. So, we will not be able to confirm or deny your hypothesis. We will play it out as
the market presents itself.
Ankur Sharma: Fair point. And just a follow-up on the motor business again. Maybe Sanjeev, either of you can
answer. Just on the upcoming competition, we are hearing players like WEG, NIDEC, some of
these large MNCs looking to set up capacities in India. So, anything you can help us on the
incoming competition there?
Sanjeev Sharma: Yes. That is true that Indian market is attractive, and it is attracting the players who are not
present here in this country. And they will find their space, and they will rightfully also find their
niches as well as the market space. But at the same time, we should know that the market is
expanding at a good healthy rate, and that's where it is. And our ability to deliver, even during
the stress situation like COVID, I think, keeps us at a very high speed in the eyes of our
customers, and there's quite a bit of loyalty built with the customers who want to stay with us.
So, that's something we continue to enjoy. But of course, when our competitors set up capacity,
I think like anywhere in the world, they will also create their own space, yes.
ABB India Limited
August 11, 2023
Page 14 of 20
Ankur Sharma: And just one last one on the rail side, especially on the propulsion. Clearly, what we're seeing is
a lot of project orders that the rail is ordering out, large LOCO, Vande Bharat, etc., tenders on
the Vande Metro as well, two private players to participate. So, how are we approaching that?
Because clearly, then you have to tie up with some of these guys who make the entire loco or a
coach, right, and then we supply the propulsion into that. So, some help there, do we have a tieup in place?
Sanjeev Sharma: So, we are participating in that market, and we'll get back to you soon if we have a success in
that engagement.
T. K. Sridhar: But these orders will all take time to decide, right? So, because these are all mega orders, Ankur,
so I think it has to go through the process of verification and the placing of orders by agency.
Sanjeev Sharma: But you’re right, I think this particular market segment is positive for our portfolio. And our
engagement is in the right place. And whenever such orders come, that will be quite an event,
and we will announce it to you.
Moderator: We have our next question from the line of Puneet Gulati from HSBC.
Puneet Gulati: Congrats on great numbers. Can you also talk a bit about what is the situation in terms of supply
chain for you and for the competition in general?
Sanjeev Sharma: I can reply about ourselves, I have no clue about competition. Our supply chain has eased out in
most of the areas. And as I said, even during the peak of supply chain trouble, our global supply
chain managers really helped us out, that network helped. And we could cater to the demand
which we thought we can cater to at that time. And we didn't disappoint any of our customers
during that period. We were very forthright and clear. Right now, all those strains that we had
in the supply chain, they are not visible. I think it's fairly evened out for us at this point of time.
Puneet Gulati: And secondly, can you also comment a bit on what are the further levers that you still have for
your margin expansion? And how high can you go from these levels?
Sanjeev Sharma: Sridhar, do you have a formula for that?
T. K. Sridhar: Puneet, I don't have a formula for that. I think it's a play of what we offer to the customers, right,
and how we intelligently manage our capacities and the cost, right? So, this is basically what it
is. And that's exactly what we have been trying to do. Our first initiative was to make it more
credible over the last 8 to 10 quarters, which we have done. And we have now slowly gotten into
the double-digit PAT margin, that’s what we see, right? So, I think we would like to remain
consistent and credible over there rather than just promising from here.
Puneet Gulati: And just last one. Your share of direct sales this quarter has gone up. How should one read that?
Is it more quarter sensitive? Or is there a change in strategy from that?
ABB India Limited
August 11, 2023
Page 15 of 20
T. K. Sridhar: Direct sales in the sense?
Sanjeev Sharma: End users.
Puneet Gulati: In your channel mix, sir.
Sanjeev Sharma: Large orders.
T. K. Sridhar: It's basically about large orders and system orders, what we have got both. So, that's, in fact,
actually what has changed the share for this quarter.
Moderator: We have our next question from the line of Parikshit Kandpal from HDFC Securities. Please go
ahead.
Parikshit Kandpal: Congratulations on a great quarter. Sir, my first question is on the expansion plans in India. So,
I think earlier in the call, you said that the global divisions are interested in sourcing more from
India. So, just wanted to understand the large part of expansion which is happening in India. So,
how will be the mix there in terms of your own global companies and in terms of Indian market?
And how will it impact our exports, which is right now at 10%?
Sanjeev Sharma: So, my mandate as a Managing Director for ABB India Limited is to serve these domestic
markets. That's the reason why we have a multinational arm present in India. Other places, our
company is present and is catering to those markets outside India. Now as we cater to Indian
market and our production capacities have increased to a good scale, and also our sophistication
and our productivity measures; it's not only the labor arbitrage India has, but also the productivity
arbitrage we are able to create now with technology, robotics, automation. So, our plants have
become global standards.
Now we have certain global market demand, and we have that capacity available across the
globe to cater to that demand. Now it is for the global divisions to adjust those capacities
somewhere else before we can serve the given demand from India. So, I think this will be a
logical process over a period of time. And in many of the divisions, that's already taking place,
and we have seen quite an upsurge of volume being supplied out of India into export markets.
But in short term, I don't think the percentages needle will move too fast because the domestic
market is growing much, much faster than the international market. And if we have a capacity
adjustment at a global level and that gets moved lock, stock and barrel in India, then that's the
only time we will see this needle move on the percentage side.
Parikshit Kandpal: And sir, my second question is on the pricing bid. So, post COVID, suppose that the highest
level of pricing was at 100, so what could be the trend now, given there has been correction in
commodity prices? I think earlier also, you said that motor, there has been some kind of
slowdown because of the correction in commodity prices. So, what levels of pricing would be
from the peak levels right now?
ABB India Limited
August 11, 2023
Page 16 of 20
Sanjeev Sharma: So, one thing we should know is when the inflation comes in, that inflation stays, right? That
escalation of the price that takes place as inflation, it stays into the system, and it stays as an
input cost. It doesn't go away. Now when the fluctuation of certain commodities by the actual
price goes up and down, that gets adjusted as you play the market. And typically, the price in
the market is based on demand and supply situation. It is not adjusted by the input cost basis.

Sanjeev Sharma: So, Ankur, nothing increases in a straight line. And if you go back many quarters, the motors

division has been growing at a very, very healthy rate. So, I think we have not only gamed the

market, but also, we have gained a lot of market share. Now a time comes when you will always

have a certain adjustment of the market demand and also adjustment of the competition, response

also to the position you take in the marketplace. So, in a portfolio wherein we have 18 divisions,

and we have 23 market segments, we will always see this cyclicality, which is built into our kind

of portfolio. So, we will not be able to confirm or deny your hypothesis. We will play it out as

the market presents itself.

Ankur Sharma: Fair point. And just a follow-up on the motor business again. Maybe Sanjeev, either of you can

answer. Just on the upcoming competition, we are hearing players like WEG, NIDEC, some of

these large MNCs looking to set up capacities in India. So, anything you can help us on the

incoming competition there?

Sanjeev Sharma: Yes. That is true that Indian market is attractive, and it is attracting the players who are not

present here in this country. And they will find their space, and they will rightfully also find their

niches as well as the market space. But at the same time, we should know that the market is

expanding at a good healthy rate, and that's where it is. And our ability to deliver, even during

the stress situation like COVID, I think, keeps us at a very high speed in the eyes of our

customers, and there's quite a bit of loyalty built with the customers who want to stay with us.

So, that's something we continue to enjoy. But of course, when our competitors set up capacity,

I think like anywhere in the world, they will also create their own space, yes.

ABB India Limited

August 11, 2023

Page 14 of 20

Ankur Sharma: And just one last one on the rail side, especially on the propulsion. Clearly, what we're seeing is

a lot of project orders that the rail is ordering out, large LOCO, Vande Bharat, etc., tenders on

the Vande Metro as well, two private players to participate. So, how are we approaching that?

Because clearly, then you have to tie up with some of these guys who make the entire loco or a

coach, right, and then we supply the propulsion into that. So, some help there, do we have a tieup in place?

Sanjeev Sharma: So, we are participating in that market, and we'll get back to you soon if we have a success in

that engagement.

T. K. Sridhar: But these orders will all take time to decide, right? So, because these are all mega orders, Ankur,

so I think it has to go through the process of verification and the placing of orders by agency.

Sanjeev Sharma: But you’re right, I think this particular market segment is positive for our portfolio. And our

engagement is in the right place. And whenever such orders come, that will be quite an event,

and we will announce it to you.

Moderator: We have our next question from the line of Puneet Gulati from HSBC.

Puneet Gulati: Congrats on great numbers. Can you also talk a bit about what is the situation in terms of supply

chain for you and for the competition in general?

Sanjeev Sharma: I can reply about ourselves, I have no clue about competition. Our supply chain has eased out in

most of the areas. And as I said, even during the peak of supply chain trouble, our global supply

chain managers really helped us out, that network helped. And we could cater to the demand

which we thought we can cater to at that time. And we didn't disappoint any of our customers

during that period. We were very forthright and clear. Right now, all those strains that we had

in the supply chain, they are not visible. I think it's fairly evened out for us at this point of time.

Puneet Gulati: And secondly, can you also comment a bit on what are the further levers that you still have for

your margin expansion? And how high can you go from these levels?

Sanjeev Sharma: Sridhar, do you have a formula for that?

T. K. Sridhar: Puneet, I don't have a formula for that. I think it's a play of what we offer to the customers, right,

and how we intelligently manage our capacities and the cost, right? So, this is basically what it

is. And that's exactly what we have been trying to do. Our first initiative was to make it more

credible over the last 8 to 10 quarters, which we have done. And we have now slowly gotten into

the double-digit PAT margin, that’s what we see, right? So, I think we would like to remain

consistent and credible over there rather than just promising from here.

Puneet Gulati: And just last one. Your share of direct sales this quarter has gone up. How should one read that?

Is it more quarter sensitive? Or is there a change in strategy from that?

ABB India Limited

August 11, 2023

Page 15 of 20

T. K. Sridhar: Direct sales in the sense?

Sanjeev Sharma: End users.

Puneet Gulati: In your channel mix, sir.

Sanjeev Sharma: Large orders.

T. K. Sridhar: It's basically about large orders and system orders, what we have got both. So, that's, in fact,

actually what has changed the share for this quarter.

Moderator: We have our next question from the line of Parikshit Kandpal from HDFC Securities. Please go

ahead.

Parikshit Kandpal: Congratulations on a great quarter. Sir, my first question is on the expansion plans in India. So,

I think earlier in the call, you said that the global divisions are interested in sourcing more from

India. So, just wanted to understand the large part of expansion which is happening in India. So,

how will be the mix there in terms of your own global companies and in terms of Indian market?

And how will it impact our exports, which is right now at 10%?

Sanjeev Sharma: So, my mandate as a Managing Director for ABB India Limited is to serve these domestic

markets. That's the reason why we have a multinational arm present in India. Other places, our

company is present and is catering to those markets outside India. Now as we cater to Indian

market and our production capacities have increased to a good scale, and also our sophistication

and our productivity measures; it's not only the labor arbitrage India has, but also the productivity

arbitrage we are able to create now with technology, robotics, automation. So, our plants have

become global standards.

Now we have certain global market demand, and we have that capacity available across the

globe to cater to that demand. Now it is for the global divisions to adjust those capacities

somewhere else before we can serve the given demand from India. So, I think this will be a

logical process over a period of time. And in many of the divisions, that's already taking place,

and we have seen quite an upsurge of volume being supplied out of India into export markets.

But in short term, I don't think the percentages needle will move too fast because the domestic

market is growing much, much faster than the international market. And if we have a capacity

adjustment at a global level and that gets moved lock, stock and barrel in India, then that's the

only time we will see this needle move on the percentage side.

Parikshit Kandpal: And sir, my second question is on the pricing bid. So, post COVID, suppose that the highest

level of pricing was at 100, so what could be the trend now, given there has been correction in

commodity prices? I think earlier also, you said that motor, there has been some kind of

slowdown because of the correction in commodity prices. So, what levels of pricing would be

from the peak levels right now?

ABB India Limited

August 11, 2023

Page 16 of 20

Sanjeev Sharma: So, one thing we should know is when the inflation comes in, that inflation stays, right? That

escalation of the price that takes place as inflation, it stays into the system, and it stays as an

input cost. It doesn't go away. Now when the fluctuation of certain commodities by the actual

price goes up and down, that gets adjusted as you play the market. And typically, the price in

the market is based on demand and supply situation. It is not adjusted by the input cost basis.